According to Ariely and Simonson (2003), online auctions have turned out to be “one of the greatest success stories of web-based services”.
Nowadays almost every user of the Internet did joined an online auction. The best know online auction is eBay, but there are lots of them. Focusing on The Netherlands, the most known auction websites are Vakantieveilingen.nl and Hotelkamerveiling.nl. If you ask your friends or family about their online auctions experience, they will probably have an experience to tell you. Often these stories are based on success or unsuccessful auction biddings, using emotional bidding. Ariely and Simonson (2003) found that 76.8% of the bidders perceive other bidders as “competitors” and refer to auction outcomes as “winning” and “losing.” This feeling about winning and losing is also discussed during class. Losing an auction will often lead to the feeling of wasting your time. Such feelings are part of human’s emotions, and that’s a link to the paper of Adam et all.
The paper of Adam et al is interesting because they are the first that made a framework for emotional bidding.
As the housing market continues to grow, the walls of new homes need some decoration. You decide you want a nice piece of art but where to start, what is your personal taste? Even if you know your preferences, you may find it rather difficult to describe them to find the type of art you are looking for. Now there is ARTO Gallery, the application that helps you find your perfect art match!
What is ARTO?
ARTO Gallery, launched in 2016 by Jonie Oostveen who was a former Director Business Development at Spotify, is a new way to discover and buy art from your mobile device. The app helps experts as well as non-experts to discover great paintings based on their personal preferences, while also giving artists a platform to sell and promote their artworks. The platform offers art of both independent artists and galleries but also partners with renowned museums (e.g. the Rijks Museum and the National Gallery of Art). Currently the platform has a database of 5.500 artists and more than 20.000 pieces, which is expected to grow to 50.000 by the end of the year.
How does it work?
Once you open the app, you will see your “Art Stream”. Customers participate as active “co-creators”(Tsekouras, lecture 2017) by indicating per artwork whether they like it or not through swiping it left or right. The more the customer swipes, the better ARTO Gallery understands their personal preferences. By using the Artificial Intelligent “Art Recommendation Engine” ARTO can recommend artworks from their database to the customer. Furthermore, it is possible to stream artwork to your TV to imagine how the piece would look in your room, ask questions to the artists and see similar artworks to the ones you liked. Artists pay for the service if a transaction takes place as ARTO Gallery charges the artists’ account a certain percentage of the value of artworks sold. For customers the platform is free of charge.
ARTO Gallery impression
Efficiency Criteria
ARTO is the first two-sided personalized platform that connects art seekers to galleries and artists. The platform maximizes the joint profitability of both partners (Carson et al., 1999). On one side, art seekers are now enabled to find artworks they love more efficiently as their choice overload is reduced by personalized recommendations. Moreover, the invested effort is relatively low as using the application requires much less time than browsing gallery websites.
On the other side, galleries and artists have easy and low cost access to a new customer base, increasing their potential returns. Moreover, through this process ARTO Gallery allows the long tail of art to grow (Brynjolfsson et al., 2006) as more customers discover unfamiliar artwork styles while artists and galleries can adapt their supply to this.
Futhermore, I consider criterion for the feasibility of required reallocations (Carson et al., 1999) to be met. However, evaluating the institutional environment, I would say that legally there is the largest threat for platform abuse. One might want to sell copies of paintings as if it is original work (intellectual property issues), which may both harm the potential buyer as well as the reputation of ARTO Gallery as a platform. Nonetheless, ARTO Gallery addressed this by their notifications of copyright infringement. Moreover, artists are carefully screened before they are allowed to upload work on the platform. In addition, artists and galleries are always responsible for their own artworks and personal information may be handed over to legal institutions at all times.
Future
I think the ARTO Gallery application is unique and considerably differs from its competition by offering personalized art recommendations. This feature makes it a great way to discover your personal taste and new artworks, while it offers a platform for art suppliers to expose their works. However, as the application is launched recently it is difficult to tell whether it will establish itself into the marketplace. I think first some marketing investments need to be done as the application is still quite unknown, but there is definitely potential!
References
Brynjolfsson, E., Hu, Y., and Smith, M.D. 2006. From Nichees to Riches: Anotomy of the Long Tail. Management Review 47(4) 67-71.
Imagine you just came back home from a long trip abroad and you want to share your experiences with your friends and family by writing a blog. Travel blogging, however, is time-consuming. So, you decide to post your photos on Facebook. Not a bad way to share your journey, but it does not really capture the essence of your awesome experiences either..
Polarsteps – Why was it created, what is it and how does it work?
Just before leaving for his sailing trip, Polarsteps co-founder Niek wrote a small script that read off his coordinates from a GPS tracker and sent them to a server via satellite phone (Ho, 2016). Niek’s website went viral among travelers, who loved the idea of telling your travel story on a beautiful map and sharing it with their loved ones back at home. This inspired Niek to further develop the idea (Ohr, 2016).
Polarsteps is an Amsterdam-based app that automatically tracks travelers’ journeys. Travelers don’t need to worry about internet costs, because the app uses offline GPS-tracking. Once Wi-Fi-connection is available, the app seamlessly transfers all tracked information to the traveler’s Polarsteps webpage. Here, the trip is displayed on an interactive map showing the traveler’s routes, key locations and photos. Polarsteps tracks a ton of other statistics, such as kilometers traveled. Furthermore, travelers can keep their friends and family updated as to where in the world they are by sharing their trip real-time. Users can instantly add photos and locations to the interactive map or do it afterwards. Thus, no need to worry about battery drain either. Travelers can also follow other travelers and explore their trips. Finally, Polarsteps offers printed travel books, which includes all travel routes, statistics and photos, turning travel moments into lifetime memories.
Efficiency criterion – Joint profitability
Polarsteps automatically generates users’ travel story on a beautiful map which can be shared real-time with their loved ones back at home. Polarsteps also functions as a platform where users can follow other travelers’ trips and share theirs. Additionally, users can buy a personal travel book, so they can look back on their journey.
The founders of Polarsteps are passionate travelers who focus primarily on helping other passionate travelers log their travels and tell their stories. Polarsteps wants its platform to enable travel organizations to create branded accounts where they can share their routes and tell their stories. The company considers adding features such as sharing the content on social media and incorporating booking reservations. Eventually Polarsteps wants to become THE app for discovering, logging and sharing beautiful routes. Other sources of income may come from selling travel books and gift cards. However, this is not the core of the business model (Tmoz.com).
Required reallocations
Polarsteps has an extensive terms and privacy statement that users must agree to. It includes the following:
Users are responsible and liable for all activity on their account.
Polarsteps collects personal information provided by the user, information collected automatically and information it receives from third parties.
Users can choose between 3 privacy levels: Only me, Only my followers or Everyone.
Polarsteps urges users to think carefully about the consequences of using the Trvavel Tracker functionality, when Everyone can view their account.
Southwest Airlines is one of the most customer centric companies of 2016 per customerguru.in. If we look at their mission statement you could tell: “Dedication to highest quality of customer service delivered with a sense of warmth, friendliness, individual pride and company spirit.” Southwest Airlines goal is to make every journey an unforgettable one and with this they have achieved a very loyal customer base. I will go through Southwest’s customer centric business model by emphasizing on the efficiency criteria joint profitability discussed in class. So, I will look through Southwest Airlines business model by finding out if the system design is maximizing the joint pay offs of the partners involved (CCDC, 2017).
Southwest Airlines understands that happy employees will guarantee happy customers. “Our people are our single greatest strength and most enduring long-term competitive advantage’’ (southwest.com). So, it is not surprising that the employees stay with the airline even though they are paid less compared to other airlines. Before you can be customer centric you must be employee centric is what turns out here. Competitive prices, free checked luggage, and friendly employees are what they are also known for but Southwest reputation is at its best when things don’t go well. That’s when their good system is in place. An experience many Southwest Airlines passengers could recall is when the gate-agent of already book tickets for the next flight to their destination when the they were supposed to fly was grounded due to bad weather conditions. Even before you requested it. What was supposed to be an inconvenience turned out to be a moment of pleasant surprise for the customer. This is all the joint profitability is about: with emphasizing on customer happiness they create a loyal customer base which, in the end, will result in more revenue.
So, Southwest Airlines sees the importance of moving from a tactical to a more strategic approach of customer participation and this is critical for all their forms of social marketing. Southwest Airlines could embrace social business as a natural evolution of their business model, because they have always been customer-centric. Southwest Airlines, at least relative to their peers, have always viewed themselves as “agents of the customer,” focusing first on creating superior customer value, while understanding that profit is one outcome of successfully creating customer value. Companies that pursue any social business initiative as another tactic to improve shot-term profitability, are increasingly at risk, given the exponential increase in customers’ access to information. Southwest Airlines has done a great job with enhancing information and participation with their customers and, thus, creating a top of the bill customer centric business model.
Consumer Value Creation 